First auction of distressed property is set for April
ARE you interested in a three-bedroom apartment in an upmarket Dublin location for €220,000?
It is just one of the offers that will be available at a bargain-basement sale this spring.
The first auction of the country's "distressed" property will offer investors a cornucopia of attractive assets, ranging from country houses to Georgian city centre flats.
Those who fancy taking a punt on a recovery in the decimated property market should prepare to head to the Shelbourne Hotel.
British auction house Allsop plans to hold four distressed property auctions this year in partnership with an Irish property company.
The first is in April, when between 50 and 80 lots will be on offer.
The sale will include properties from receivers, banks and property owners, and will include tenanted flats in exclusive districts of Ballsbridge and Sandymount, and country houses outside Dublin.
Most of the properties on offer in Dublin are tenanted flats and include Georgian homes in Dublin 4, where some of the highest prices were achieved at the top of the market. There will also be small commercial buildings with retail and office tenants.
The reality of our property crash will be revealed at the auctions, with homes expected to raise little more than 50pc of their boomtime value in many cases.
Lloyds Banking Group has a €27bn exposure to the market here, and its London-based business support team took control of its distressed-loan book last month.
Space, the property group that Allsop is working with, said that there was a clear need to offer "crucial benchmarking" regarding where property values "really are".
"Many private sellers have been obstinately asking prices that are clearly historic and over-optimistic," said company founder Stephen McCarthy. "It's been very difficult to say what a property is actually worth in Ireland today."
In a departure from the British auction practice of quoting guide price ranges, the sale will publish a maximum reserve price.
For example, a modern three-bedroom, two-bathroom apartment in a sought-after central Dublin block that will be sold at the auction was formerly on the market for more than €900,000. The maximum disclosed reserve for the property at auction will be €220,000 -- a 75pc discount. It means if someone bids €220,000 and nobody bids higher, the house will be sold for that.
Allsop partner Gary Murphy will conduct the first auction. He said that there was a "tremendous business opportunity in Ireland.
"We want bidders to appreciate that if they can afford to bid the disclosed maximum then, provided the bidding does not go higher, the hammer will fall and the property will be theirs. It's that transparent," he said.